The US shipped a record 11 liquefied natural gas cargoes for a second week as the nation’s three facilities keep up high production while domestic consumption and pipeline exports to Mexico fell amid continued high shale-gas output in the Permian Basin where prices were negative early in the week due to the lack of take-away infrastructure.
Eight cargoes left Cheniere Energy’s Sabine Pass export plant in Louisiana, while two left Cheniere’s Corpus Christi facility in Texas and one departed from Dominion Energy's Cove Point plant in Maryland during the week, according to the US Energy Information Administration.
The total shipped comprised 38.2 billion cubic feet of natural gas with each LNG tanker carrying an average of 3.45 Bcf. Three other carriers, one at each of the plants, were lifting cargoes through May 23.
Three other plants, Cameron LNG in Louisiana, the Elba Island project in Georgia and the Freeport facility in Texas are scheduled to start commercial operations in the next three months.
US consumption of natural gas fell by 3 percent in the past week amid high production in shale areas such as the Permian Basin and pipeline exports to Mexico decreased 4 percent.
Take-away infrastructure for the high Permian volumes is still lacking in hub areas. This was highlighted during the week when Permian area prices went negative.
“Prices at the Waha Hub in West Texas, which is located near Permian Basin production activities, averaged $0.86 per MMBtu on May 23, $1.75/MMBtu lower than Henry Hub prices,” explained the EIA.
The prices through May 22 at the Waha Hub averaged just $0.01 percent per MMBtu after hitting a low of minus-$0.56 per MMBtu, coinciding with two days of planned maintenance on the Northern Natural Gas pipeline.
Domestic natural gas prices declined elsewhere in the week. Henry Hub spot prices remained flat at around $2.61 per million British thermal units.
“Temperatures were warmer than normal east of the Mississippi River and cooler than normal across the rest of the country,” said the EIA report.
At the Chicago Citygate, prices decreased 4 cents to $2.29 per MMBtu and prices at PG&E Citygate in Northern California fell 22 cents to $3.23 per MMBtu.
At the Algonquin Citygate serving the Boston area prices declined 7 cents on the week to $2.25 per MMBtu.
The Transcontinental Pipeline Zone 6 trading point for New York City saw prices decrease by 6 cents to $2.27 per MMBtu.
Tennessee Zone 4 Marcellus shale-gas spot prices were little changed at $2.13 per MMBtu, offering the normal discount to the Henry Hub.
On the storage front, weekly net injections into storage totaled 100 Bcf compared with the five-year (2014-2018) average net injections of 88 Bcf and last year's net injections of 93 Bcf during the same week.
“Working gas stocks totaled 1,753 Bcf, which is 274 Bcf lower than the five-year average and 137 Bcf more than last year at this time,” said the EIA.
